Daily Links: Holiday Weekend Edition

Labor Day weekend begins tomorrow afternoon in the U.S. It’s the traditional end-of-summer holiday, and most folks will get Monday off as a paid holiday. My own vacation is going to be a bit different: I’m going to take tomorrow off instead. This will be the last post until Sunday evening.

But as always when I take a short break, I’ll actually be working behind the scenes. Next week is Book Week at GRS, so I’ll be reading and reviewing at least three books. Plus, I’ll be writing the first batch of articles for my animal blog (as part of the GRS blog project) and editing the articles that will run while Kris and I are in Europe next month. So, even though GRS itself is on holiday this weekend, I’m not!

Before the break, however, here are a few financial articles from around the web:

Next, USA Today has an article about how the current generation of investors could become a “lost generation”. Mutual fund companies worry that investors are on strike. From the article: “The fear on Wall Street is that this buyer’s strike will linger for years, resulting in a lost generation of investors similar to what occurred after steep stock declines in the 1930s during the Great Depression and early 1970s, a recessionary time punctuated by high inflation.” It’s an interesting article with lots of info about the pros and cons of investing during a rocky market.

A GRS reader — whose name I’ve forgotten (sorry!) — sent me a link to this BBC article about The Age of Debt. Author Adam Curtis cites recent scholarship that says that the West’s recent debt-fueled economy came about because the rich were getting richer. The only way for governments to help the middle-class sustain their lifestyles was to encourage them to fund consumption through debt. His article includes several great old videos about debt. Interesting stuff, regardless of whether you agree with the premise.

One final note: This weekend, I’ll be a guest on the syndicated radio program Your Money Matters with Marc Pearlman. On Monday, Pearlman and I chatted about debt, investing, and the psychology of spending. Check your local listings to see if the show is broadcast in your area. If not, you can listen online, download the show from iTunes, or visit the website to find the show in the archives.

The list of freebies has its gems, but a couple of stupid items: there’s a list of junk food freebies (unhealthy & poverty-inducing), and it suggests you use a rewards credit card for “free miles” on your grocery purchases. Are you kidding me? According to Dave Ramsey who quotes some industry study, 90% of airline miles go forever unredeemed. And buying groceries with credit card always ends in overspending and with an unpaid balance in the majority of cases– an expensive & stupid “freebie”.

I use a credit card to buy groceries, and I don’t overspend. If you payoff your credit card balance in full, even if you don’t use the airline miles, it doesn’t hurt you in the slightest.

And Dave Ramsey has been known to misquote statistics to back up his anti-credit card stance.

So far this year, I’ve received over $600 in cash back on my purchases from credit card rewards. I pay for anything I can with a rewards credit card. I always pay my balance off in full. My wife and I max out our IRAs, and I put in enough for a company match in my 401k, and we’ll manage to pay down our mortgage by $10,000 this year. All this while using credit cards for purchasing everything we can.

Dave Ramsey’s ideas work well for some people, but those of us who are disciplined don’t need to shun credit cards like they’re the black plague.

If using a rewards credit card doesn’t work for you, that’s fine, don’t use them. But it doesn’t mean they’re a bad idea for everyone.

I think it is healthy to be skeptical about the stock market, rather than believing in the conventional wisdom that you can earn 10%+ per year with ease. We had a couple stock market bubbles, now we’re seeing the opposite – people fleeing to the safety of bonds.

I hope we get a review of The Art of Non-conformity. Although not financial related (not directly anyway) it would probably still appeal to many GRS readers. I’ve already pre-ordered the book, but will be curious to hear what you think.

Love this quote: “Until things get better, I’m not putting any more money into stocks.”

That’s great! Wait until prices go up, THEN buy. Meanwhile, I’m going to keep buying every month, and happily acquire the most stock for the lowest prices I can. I am Gen X, and I am not “skittish”. I don’t care if I don’t get 10%; whatever I get is most likely going to be better than the 1-3% cash and bonds would get me, and I have plenty of time to get conservative later. Talk about wasted youth!!!

“The age of Debt” was interesting, esp. when they started quoting Robert Reisch! Talk about a far left of center viewpoint about the evil rich and their bankers MAKING people use credit to support a lifestyle they could not afford but “had to have” because they saw too many episodes of “Lifestyles of the Rich and Famous”!

What we have witnessed for the last three decades is an aberation…there really is NO FREE LUNCH. If you want more toys and a bigger house, you have to increase your income, not build a house of cards with Visa, Mastercard, and AmEx!

Exactly. While I know that some people really aren’t able to raise themselves up, many people can find a way to work harder – whether through getting more education or just a better job – and raise themselves up to the level they wish to be at.

Although, with this economy and how difficult it is to find jobs, there are more and more people relying on those cards just for the basics. And then they are going to have a horrible time attempting to get to the levels they want to be, because they will be buried in the debt they had to create.

I semi-retired early. When I finished work I was expecting my 401k to keep building big like it had for the last few years. Instead I lost about 20% and I am too nervous to put it out in stocks again…..Do not want to loose it all. So I am one of the many staying out of the stock market…..only my big toe is in….5%

I felt in fal 2008 when the stock market fell so far in one day that another whole generation of Americans would abandon the stock market—just as did my parents when they experienced the Great Depression.

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